NSEL scam: FMC fields PwC to scan MCX for wrongdoing

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SummaryAuditor to study if NSEL arm Indian Bullion and Financial Technologies subsidiary traded on MCX.

Commodity markets regulator FMC has appointed global auditing firm Price Waterhouse Coopers (PwC) as the auditor to conduct a special audit of Multi Commodity Exchange of India Ltd (MCX) and examine if there was trade by related parties on the bourse.

In the wake of Rs 5,600 crore NSEL scam, the FMC had in September ordered special audit of the MCX for auditing related party deals especially by IBMA and NBHC.

National Spot Exchange Ltd (NSEL), a sister concern of MCX, is facing payment settlement problems after it suspended trading in July-end following the government direction due to violation of norms. Both the exchanges are promoted by Jignesh Shah-led Financial Technologies India Ltd (FTIL).

"The Commission approved the appointment of PriceWaterhouseCoopers (PwC) to conduct special audit of MCX," Forward Markets Commission (FMC) said in its fortnightly report that detailed the performance of commodity bourses.

The regulator has approved the name of PwC as suggested by the audit committee of the exchange's board to the FMC.

The terms of reference would be examination of trades on MCX by related parties and also expenditure items such as donations and warehousing charges.

The special auditor will study if NSEL arm Indian Bullion Markets Association (IBMA) and FTIL's subsidiary National Bulk Handling Corporation (NBHC) traded on the MCX.

Besides, the regulator said it has approved appointment of one independent director and four shareholder directors on the MCX Board.

Retired IAS officer Satyananda Mishra has been appointed as Independent Director on the MCX board till March 31, 2016.

He has also been appointed as the chairman of the Board.

FMC said it has appointed retired IRS officer G Anantharaman as chairman of the Audit Committee and retired IAS officier Ravi Kamal Bhargava as chairman of Remuneration Committee of the Exchange.

SBI Deputy Managing Director and Group Executive B V Chaubal, Canara Bank General Manager M A K Prabhu, Bank of Baroda General Manager Sanjay Agarwal and Union Bank of India General Manager K N Reghunathan have been appointed as shareholder directors on the MCX Board, the regulator said.

Their appointment term is for one year 2013-14 or up to the date

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